Is a Labor Government looking likely?

As Australia waits for an election result and many pundits continue to predict a Coalition victory, Alan Austin discusses the growing prospect of a minority Labor Government.

HAVE those crazy Australians done it again?

Have they fluked the best of all possible election outcomes — a minority Labor Government in the House of Representatives and a motley bunch of crossbenchers controlling the Senate?

When they last did this the administration was condemned as dysfunctional by the Coalition Opposition and the mainstream media. But to those who examine hard data – actual facts and figures – the Gillard/Rudd Government from 2010 to 2013 delivered better outcomes for its citizens than any Australian government before or since. And greater success than any government in the world at that time.

Let’s consider some of that data which the conservative media and other powers want concealed.

But first, what are the chances of such a result again?

According to the Australian Electoral Commission this morning, Labor is leading with 71 seats and the Coalition 67. The Greens should support Labor, as in the past. So should independents Cathy McGowan and Andrew Wilkie (though the former has already been approached by Malcom Turnbull). Bob Katter and the two Nick Xenophon MPs will probably support the Coalition.

That gives Labor 74 and the Coalition 70 seats in the 150-seat House. Six remain in doubt. Labor could win three of these – Durack, Grayndler and Dunkley. The other three – Barker, Cowper and Higgins – are undecided close contests between the Coalition and minor parties or independents.

Historically there have been successful minority governments working with hung parliaments: https://t.co/fGsjADIMlR

With just two, Bill Shorten can form a minority government similar to Julia Gillard’s in 2010.

Those who applaud that regime – including Nobel Prize winning U.S. economist Joseph Stiglitz – do so for at least ten substantial accomplishments.

1. Deficits

Determined pursuit of surpluses by former treasurer Wayne Swan – goaded by the mass media’s frenzied anti-Labor attacks – led to low deficits relative to the rest of the world. Labor’s last deficit, in 2012-13, was just $18.8 billion, or 1.2% of gross domestic product (GDP).

In contrast, the Coalition’s last deficit, in 2015-16 was $40.0 billion, or 2.4% of GDP. That is a higher percentage than for any of the world’s top ten economies – those with all three AAA credit ratings – Australia, Canada, Denmark, Germany, Luxembourg, Netherlands, Norway, Singapore, Sweden and Switzerland.

2. Government debt

Relative to comparable countries, Labor’s debt record is also remarkable. When the global financial crisis (GFC) hit with destructive force in late 2008, borrowings were necessary as the Howard Government had left virtually no buffer. Yet even with extensive stimulus spending through the GFC, net debt under Labor never exceeded $175 billion or 12% of GDP.
Now, in stark contrast, it is $286 billion – 17.3% of GDP – and forecast by Treasury to reach $347 billion – 19.2% of GDP – under the Coalition next financial year.

Australia is the only country in the AAA top ten which has increased its debt to GDP every year since 2013, with the global recovery strengthening.

3. Jobs and growth

Jobs have been lost and growth has stagnated in Australia since the last election. Worsening unemployment has been masked by the shift from full-time to part-time and casual workers — that and the blatant falsehoods of the Coalition Government and the media.

The latest jobs figures from the Australian Bureau of Statistics (ABS) show:

Full-time employees are now 64.4% of the work force — an all-time low.

Hours worked relative to the population have fallen to the lowest level since 1993.

Job participation has fallen to 64.8%, below the level three years ago.

4. Overall economic management

The Coalition in Opposition back in 2012 and 2013, identified 23 problem areas in Australia's economy under Labor which it promised to fix. Most are listed here and here.

All 23 of these have deteriorated since 2013 — relative to Labor's levels, or relative to the rest of the developed world, or both.

5. Ministerial integrity

The Howard Government had 15 ministers resign for incompetence or integrity issues. The Abbott/Turnbull Government has had ten removed from executive positions for incompetence or integrity matters – in 34 months.

In contrast, the five years and 10 months of the Rudd/Gillard/Rudd period saw only one minister sidelined for a minor competence failure. Joel Fitzgibbonresigned in June 2009. He was reinstated in July 2013. (Note: this does not count departures for loyalty-to-the-leader issues. That is a different category.)

6. Legislative reform

Parliamentary records show the Rudd/Gillard/Rudd period had one of the highest rates of legislation passed. It also appears to have had the highest rate of any administration of bills opposed by an obstructionist Opposition.

Julia Gillard’s record four-minute standing ovation after addressing a joint sitting of the U.S. Congress.

Australia’s experience from 2010 to 2013 is not unique. British Conservative leader David Cameron in 2010 was forced into a coalition with the Liberal Democrats – which in the UK really means "liberal" – and it worked well.

Alliances have been effective also in Denmark, Germany, Luxembourg, Netherlands, Sweden and Switzerland. In fact, eight out of the 10 AAA-rated countries now have, or recently have had, coalitions of disparate parties. Canada and Singapore are the exceptions.

Why do they work so well? Is it that any stuff-up could cause the regime to collapse at any moment? A tenuous grip on power – and on the perks that go with it – focuses the mind and sharpens the instincts. Is it simply that negotiation among divergent interest groups yields superior decisions?

The Labor/Greens/Independents alliance certainly worked well before. The evidence is compelling. Those who claim otherwise are mistaken. Or lying to us. Again.